A savings account is meant to be saved up. Ideally, it is left alone until it increases to the desired amount.
However, people are not often disciplined enough to leave their savings account alone, especially when they have cash readily available. It happens mainly when they run out of their spending money and are desperate enough to dip into their savings account. They may not get much, but it is precisely that mentality that will cost them big when it comes to their savings.
Avoiding the Dip
According to professionals from Patriot Bank, a savings account is for those who want to save money for something specific. Usually, these are the big items such as a car mortgage or even a down payment for a house. Reaching that goal becomes a little tricky especially when people can’t stop withdrawing a bit of cash a lot of times from their account.
One way to stop yourself from withdrawing from your savings account is to budget. It may sound generic, but separating a certain amount for your savings account and your everyday spending will help your account grow. In 2013, a study revealed that 76% of Americans have no emergency savings because they do not know how to budget correctly.
You could also find a way to cut some other expenses. Evaluate what you spend your money on and see if you need them. Go for the essentials such as food, rent, and utility bills. Refrain from buying new things every paycheck.
Another method is to make it difficult to access your savings account. Get an account from a bank that’s relatively far from where you live or work. You could also open an account online. Either way, make sure it’s not so easily accessible to you.
Your savings account is there for the milestones of your life. You’re told not to dip into it because it may one day be the source of funds for your dream wedding, first house, or retirement. Earning money may be difficult, but saving it up is an entirely different skill altogether. The discipline required is great, but so is the reward. You reap what you sow; you withdraw what you save.